Australian Foundation Investment Co. Ltd. · ASX:AFI
Australian Foundation Investment — Investor Presentation (April 2016)
29 slides from Australian Foundation Investment's investor presentation, Apr 4, 2016
Slide 1: ASX cover letter: Information Meetings presentation
4 April 2016 For personal use only The Manager ASX Market Announcements Australian Securities Exchange Exchange Centre Level 4 20 Bridge Street Sydney NSW 2000 Electronic Lodgement Australian Foundation Investment Company Limited Information Meetings – Presentation Dear Sir / Madam Please find attac
Slide 2: Shareholder Meeting April 2016
For personal use only SHAREHOLDER MEETING APRIL 2016
Slide 3: Disclaimer
For personal use only DISCLAIMER Australian Foundation Investment Company Limited and its subsidiary AICS (AFSL 303209), their related entities and each of their respective directors, officers and agents (together the Disclosers) have prepared the information contained in these materials in good fai
Slide 4: Results & Returns
For personal use only RESULTS & RETURNS SHAREHOLDER MEETING APRIL 2016
Slide 5: Half-Year Financial Summary
For personal use only HALF-YEAR FINANCIAL SUMMARY SHAREHOLDER MEETING APRIL 2016
Slide 6: Share price is at a premium to NTA
For personal use only SHARE PRICE IS AT A PREMIUM TO NTA Approximate NTA at 31 March was $5.35, share price of $5.53 at a 3.4% premium SHAREHOLDER MEETING APRIL 2016
Slide 7: One year return of AFIC portfolio versus different sectors of the market
For personal use only ONE YEAR RETURN OF AFIC PORTFOLIO VERSUS DIFFERENT SECTORS OF THE MARKET – TO 29 FEBRUARY 2016 SHAREHOLDER MEETING APRIL 2016
Slide 8: Share price performance – per annum return to February
For personal use only SHARE PRICE PERFORMANCE – PER ANNUM RETURN TO 29 FEBRUARY 2016 SHAREHOLDER MEETING APRIL 2016
Slide 9: Short term portfolio performance impacted by energy holdings and underweight property
For personal use only SHORT TERM PORTFOLIO PERFORMANCE IMPACTED BY ENERGY HOLDINGS AND UNDERWEIGHT PROPERTY EXPOSURE – PER ANNUM RETURN TO 29 FEBRUARY 2016 After tax and expenses. Ignores benefits of franking and LIC tax credits. SHAREHOLDER MEETING APRIL 2016
Slide 10: Portfolio per annum return including benefit of franking credits
For personal use only PORTFOLIO PER ANNUM RETURN TO 29 FEBRUARY 2016 INCLUDING THE BENEFIT OF FRANKING CREDITS After tax and expenses. Ignores benefits LIC tax credits. SHAREHOLDER MEETING APRIL 2016
Slide 11: The Market
For personal use only THE MARKET SHAREHOLDER MEETING APRIL 2016
Slide 12: The ASX market has declined but this hides what is happening in Australia
THE ASX 200 MARKET HAS DECLINED BUT THIS HIDES For personal use only WHAT IS HAPPENING IN AUSTRALIA Source: FactSet. SHAREHOLDER MEETING APRIL 2016
Slide 13: Industrials have held up relatively well but banks and resources have declined
INDUSTRIALS HAVE HELD UP RELATIVELY WELL BUT BANKS For personal use only AND RESOURCES HAVE DECLINED Source: FactSet. SHAREHOLDER MEETING APRIL 2016
Slide 14: A lot happening in the economy but less in the larger companies
For personal use only THERE IS A LOT HAPPENING IN THE ECONOMY BUT LESS SO IN THE LARGER COMPANIES Source: FactSet. SHAREHOLDER MEETING APRIL 2016
Slide 15: Portfolio
For personal use only PORTFOLIO SHAREHOLDER MEETING APRIL 2016
Slide 16: Continued adjustments to the portfolio reflecting the economy
For personal use only WE HAVE CONTINUED TO MAKE ADJUSTMENTS TO THE PORTFOLIO THAT REFLECT ADJUSTMENTS IN THE ECONOMY • Reduced some exposure to: – banks – energy • Further broadened the portfolio by adding to small/midcap holdings • Takeover activity: – iProperty – Veda Group • Heightened volatility
Slide 17: Broader issues for the banking sector
For personal use only BROADER ISSUES FOR THE BANKING SECTOR • Increase in household gearing has driven bank balance sheet growth and revenue. • This is likely to have reached a peak leaving growth more subdued. • Bad debt charges remain at cyclical lows, well below even mid‐cycle levels. • Reduction
Slide 18: Banks – portfolio at February
For personal use only BANKS – PORTFOLIO AT 29 FEBRUARY 2016 SHAREHOLDER MEETING APRIL 2016
Slide 19: Energy – portfolio at February
For personal use only ENERGY – PORTFOLIO AT 29 FEBRUARY 2016 SHAREHOLDER MEETING APRIL 2016
Slide 20: Consumer Staples – portfolio at February
For personal use only CONSUMER STAPLES – PORTFOLIO AT 29 FEBRUARY 2016 SHAREHOLDER MEETING APRIL 2016
Slide 21: Real Estate – portfolio at February
For personal use only REAL ESTATE – PORTFOLIO AT 29 FEBRUARY 2016 SHAREHOLDER MEETING APRIL 2016
Slide 22: Healthcare – portfolio at February
For personal use only HEALTHCARE – PORTFOLIO AT 29 FEBRUARY 2016 SHAREHOLDER MEETING APRIL 2016
Slide 23: Portfolio top holdings represent 47% of the portfolio
For personal use only PORTFOLIO AT 29 FEBRUARY 2016 – TOP 10 HOLDINGS REPRESENT 47% OF THE PORTFOLIO * Indicates that options were outstanding against part the holding. SHAREHOLDER MEETING APRIL 2016
Slide 24: Portfolio next holdings represent 19% of the portfolio
For personal use only PORTFOLIO AT 29 FEBRUARY 2016 – NEXT 10 REPRESENT 19% OF THE PORTFOLIO * Indicates that options were outstanding against part the holding. SHAREHOLDER MEETING APRIL 2016
Slide 25: We have added to smaller positions during recent market turmoil
For personal use only WE HAVE ADDED TO SMALLER POSITIONS DURING RECENT MARKET TURMOIL SHAREHOLDER MEETING APRIL 2016
Slide 26: Looking Ahead
For personal use only LOOKING AHEAD SHAREHOLDER MEETING APRIL 2016
Slide 27: Company reporting season has generally been better than expected
For personal use only COMPANY REPORTING SEASON HAS GENERALLY BEEN BETTER THAN EXPECTED • Earnings growth ahead of dividends. • Companies delivering on cost reductions. • Some signs of revenue growth. • Balance sheets generally strong. Source: Goldman Sachs global investment research, FactSet and I/B
Slide 28: The Australian Equity Market
For personal use only THE AUSTRALIAN EQUITY MARKET SHAREHOLDER MEETING APRIL 2016
Slide 29: Australian Investment Company
AUSTRALIAN NULL? INVESTMENT COMPANY
Australian Foundation Investment Company — Investor Presentation (April 2016) on 6ix